In a move that has raised concerns, the Centre has now moved in to restrict foreign contributions to individuals and organisations in India. Critics allege that this is being done in a selective and opaque manner through a fresh set of amendments to the Foreign Contribution (Regulation) Act. Now temporarily stalled due to protests, the move is alleged to be an attempt by the Centre to empower itself to arbitrarily take control of assets owned by recipients of foreign contributions.
Introduced in the Lok Sabha, the bill to amend the FCRA proposes a comprehensive statutory framework for a new ‘designated authority’ to seize, manage and dispose of assets of organisations that lose their FCRA licence. Couched in the rhetoric of national security and foreign interventions, the move will facilitate the confiscation of assets built through legal means. Once an FCRA registration ceases to exist, the designated authority can take control of assets built using foreign funds – schools, hospitals, places of worship – and use them.
This process is proposed to be automatic and instantaneous upon the discontinuation of the FCRA status, requiring no judicial determination or adjudicatory process. In effect, the Centre that grants FCRA permission can decide to withdraw that permission and benefit from its own decision. Christian groups that run numerous health and educational institutions are particularly concerned, given that they may have received contributions from abroad.
The bill has been postponed for now, but the government has no plans to abandon it. The FCRA was first enacted in 1976, and re-enacted in 2010 during the UPA regime and amended in 2020 under Narendra Modi – progressively tightening the receipt and use of foreign funds.
Critics point out the irony of the situation. While the state policy seeks foreign money in a range of domains from infrastructure to technology and entertainment to real estate, it is cracking down on the flow of funds into schools, hospitals, places of worship, etc, and using them. Regulatory regimes, they say, can be credible only when they are transparent and even-handed. That is not the case with the FCRA restrictions.
More alarmingly, opposition MPs have been alleging that their Parliamentary questions regarding FCRA cancellations, non-renewals and related data had been disallowed since 2024. That leaves one with the reasonable assumption that the government allows only some to receive foreign funds. That built-in favouritism apart, the design of the proposed legislation violates the principles of natural justice. The assets built legally with foreign funds before an organisation loses its FCRA clearance cannot justly be subject to seizure under any subsequent regulatory action.
No going back
But will the Centre rethink its approach on this issue and ensure that any regulations on foreign funds it introduces are fair, transparent, and steer clear of what exists on the ground? Unlikely, say government sources, though Kiren Rijiju, Union minister for parliamentary affairs, has said that any misunderstandings regarding the FCRA Amendment Bill, 2026, will be addressed. He emphasised that violations will invite strict action, but organisations working for the country’s welfare will not be disturbed. He also said that concerns raised by Christian missionaries will be taken into account. Rijiju added that Prime Minister Narendra Modi remains committed to the welfare of every Indian.
The Union Minister made these remarks during his visit to Kerala, where he interacted with a wide range of stakeholders. The issue has acquired political overtones in election-bound Kerala, which has a huge Christian population. Rijiju accused Opposition parties of spreading misinformation for political gain. Explaining the government’s position, he said, “All foreign contributions to India are regulated under the FCRA framework. There is no cause for concern if funds are used for their intended purpose of public welfare. However, strict action will be taken if funds are diverted for illegal activities or used against national interests.”
But critics are not impressed. For one thing, the law does not expressly mention whether it’s retrospective or prospective, points out Prasanna S., Supreme Court lawyer, who has dealt with FCRA cases. Another Supreme Court lawyer, Nipun Saxena, feels the provisions of the Bill “give unfettered, unguided and untrampled discretionary power to the administrator, to do as it deems fit with the property”. Saxena explained that Section 1(2) of the bill says that it shall come into force on such date as the Central government may notify. “Therefore, it would apply retroactively, which would mean that it would also apply to those previous licences already applied for but have not yet been renewed or those that are pending renewal. A lot of ironing out would have to be done via the Rules. There will have to be sunset clauses that would take a specific date by which all the NGOs would have to get the necessary compliance done,” he adds. The tussle goes on.